A federal bankruptcy judge has given New York Attorney General Letitia James the OK to proceed with subpoenas for the financial records of the Sackler family, which owns Purdue Pharma, the company at the center of the opioid crisis.
U.S. Bankruptcy Judge Robert Drain made this decision on Tuesday. The decision says that the financial records of over two dozen members of the Sackler family, as well as multiple associated trusts and companies, can be subpoenaed.
Purdue Pharma, the makers of Oxycontin, filed for bankruptcy in September. They have been hit with over 2,600 lawsuits related to Oxycontin and the opioid crisis.
Several states have filed lawsuits accusing the Sacklers of helping create America’s opioid crisis through aggressive Oxycontin marketing by Purdue. Those suits have been put on hold by Purdue’s bankruptcy case. However, Drain said on Tuesday that the states can continue investigating the Sacklers’ financial records.
“We are pleased that the court authorized this examination of the Sacklers’ finances to proceed while the case against Purdue Pharma continues through the bankruptcy process,” James said on Wednesday.
James rejected a $12 billion settlement with Purdue last year as “an insult.” James then filed documents in court saying the Sacklers were attempting to move their fortune overseas to hide it from debtors.
“Records from one financial institution alone have shown approximately $1 billion in wire transfers between the Sacklers, entities they control, and different financial institutions, including those that have funneled funds into Swiss bank accounts,” James said last year.
“Just because Purdue Pharma has declared bankruptcy does not mean its owners deserve special protections under the law. We will immediately be issuing new subpoenas to multiple banks and financial institutions to determine where the Sacklers have stored their money over the years and how much has been stashed away. This case will not come to an end without these key pieces of information,” James said on Wednesday.
A June 30, 2020 deadline was recently set by a federal judge for people to file Oxycontin-related claims against Purdue. Purdue entered a guilty plea in federal court to understating the addiction risk of Oxycontin, including failing to tell doctors that the medication is stronger than morphine. The U.S. Department of Justice has said that Purdue inaccurately marketed and promoted Oxycontin as less addictive, less likely to cause tolerance and withdrawal and less subject to abuse and diversion than other drugs despite being aware that Oxycontin’s abuse potential was similar to that of morphine and that the drug was at least as addictive as other pain drugs.